Britain's Prime Minister David Cameron (R) looks at Germany's Chancellor Angela Merkel (L) at a European Union summit in Brussels December 9, 2011. EU leaders agreed stricter budget rules for the euro zone on Friday, but failed to secure changes to the EU treaty among all 27 member states, meaning a deal will instead have to involve just euro zone states and any others that want to join. REUTERS/Yves Herman (BELGIUM - Tags: POLITICS BUSINESS)

“Mommy, daddy, where were you when Britain left Europe?” David Cameron’s deployment in the early hours of Dec. 9 of the British veto over a Franco-German plan to save the euro will be seen as a pivotal moment by future generations. And it was—not just pivotal, but truly momentous. By refusing to sign up to a European Union-wide deal, Britain’s Prime Minister may not have exited the E.U. But he has returned his country to its 19th century position of “splendid isolation” from its troublesome neighbors.

It’s debatable whether isolation ever made sense, but, at least in the days of Empire, Britain had sway and a global string of captive markets for its goods. These days, the U.K.’s power has waned—it seems only yesterday (and was, in fact, just over a year ago) that the U.K. and France announced an agreement to pool depleted military resources. More than 40% of British trade is with the euro zone. Britain’s isolationist stance threatens to strand the U.K. without a full seat at E.U. negotiations yet, as a member of the E.U., though not the euro zone, it’s still subject to many decisions taken in Brussels (or Berlin or Paris).

British euroskeptics, raising warm pints of beer in celebration, will argue that the Prime Minister’s decision has protected national interests. Their island nation appears a safe haven while the euro zone lurches from one near-collapse to the next. The argument isn’t without merit. The plan Cameron rejected lacked credibility, just like previous initiatives to fix the euro zone, because individual euro zone countries are still unwilling or unable to pool sufficient powers over economic decisions or provide sufficient guarantees of their willingness to bail out weaker members to convince markets that Greece or Italy are as good a bet as Germany.

Switzerland recently demonstrated one of the dangers of safe haven status, when its currency reacted to the euro zone crisis like Popeye after several tins of spinach, making its famous watches and chocolate and other high-quality goods too expensive for the export markets that are their key destination.

Millions of British jobs rely on trade with the rest of Europe. Britain is heavily invested in the rest of Europe. Its banks are exposed to the rest of Europe. Its economy is inextricably linked to the rest of Europe. As Cameron has often acknowledged, the collapse of the euro would hit Britain very hard. Britain’s isolation doesn’t look quite so splendid after all.

So why did Cameron opt out at the Dec. 9 summit? The answer is that he didn’t. He opted out in 2005, as an outsider campaigning to win the leadership of the Conservative party against a euroskeptic frontrunner, David Davis. Cameron made a promise that delighted the euroskeptic strain: to withdraw the Conservative party from its perch alongside the mainstream center-right, but pro-European parties in the European Parliament—the so-called European People’s Party grouping, or EPP—and to align with euroskeptic soulmates. He carried through on this promise in 2009, forging a rightwing grouping in Europe with new friends such as Poland’s socially conservative Law and Justice party, and securing the support, if not the trust, of his Conservative backbenches—while alienating German Chancellor Angela Merkel and French President Nicolas Sarkozy, the leading lights of the EPP. He might have mitigated this by working overtime to build close ties with these leaders. Instead, he cultivated distance.

This may have strengthened his own base and boosted his standing with British euroskeptic voters, but wasn’t enough to secure an overall majority at the 2010 elections. Cameron was only able to take power in coalition with the europhile Liberal Democrats, led by the most European of British pols, Nick Clegg. The Lib Dem leader and Deputy Prime Minister has been careful in his choice of words to describe the Prime Minister’s latest decision. Clegg’s party colleagues are showing less restraint. “It is a black day for Britain and for Europe,” said Lib Dem peer, Lord Oakeshott.

That it may be, but Cameron set the course to this black day long before it dawned. And as I explain here, the context for his decision—the euro zone crisis—highlights the limits of the power that Cameron and other politicians actually wield in a globalized, interconnected world. From that perspective, the summit itself may prove less decisive than it now appears. The plan Cameron cold-shouldered may unravel. The euro zone is far from safety. But Britain is farther now from anywhere.